December 10, 2013 Sections
Winnipeg Free Press - PRINT EDITION
It's taken a little while but Manitoba companies are starting to line up to figure out ways to get in on the multi-billion dollar activities of the Bakken oil and gas boom just south of the border.
An unprecedented development explosion is underway in sparsely populated western North Dakota and eastern Montana that's stretching every manner of resource to the limits. Now economic development officials from the region are casting their net a little wider afield to try to tap every manner of resources needed in the region.
That's why they came to Manitoba.
Former Montana governor Brian Schweitzer spoke to more than 300 people in Winnipeg Wednesday pointing out that Winnipeg is only 32 kilometres miles farther from the epicentre of the Bakken oil fields than Billings, Mont., and Billings is booming.
"Over the next 10 years the area is going to need 110,000 more workers," Schweitzer said. "But there is nowhere to put them."
It's not oil and gas service companies they're looking for, it's companies that can supply: any kind of products or services for the housing industry; solid waste disposal; any kind of equipment supply or servicing; water supply both for the fracking operations and for human consumption; waste-water disposal and recycling; and transportation and logistics.
Wednesday's event was organized by Winnipeg's newly established World Trade Centre in conjunction with the Montana World Trade Center.
The goal of the WTC connection is to get a bit of a matchmaking process underway.
Arnie Sherman, the executive director of the Montana WTC has been trying to establish some sort of co-ordinated effort to address the infrastructure needs in the region that is overwhelming many of the communities in the area.
He said he has meetings lined up in Winnipeg with more than 20 companies and he's already extending his stay because of the interest.
"Winnipeg is the perfect place," Sherman said. "It's a city with some understanding of the oil and gas industry that's not farther away than a city like Billings and that town has all the upside and none of the downside."
Sherman will be talking to local companies that make equipment parts, tanker cars, fire engines, winter clothing and equipment, companies that have environmental-technology solutions and software companies.
"They're all here and they are in striking distance," he said. "It's much easier for a company here to be doing it than a company in San Diego or Philadelphia or Toronto. It's just straight across the border."
Schweitzer and Sherman acknowledge work in Bakken these days is a little like the Wild West and may take a little more entrepreneurial juice than a mature market that's performing normally.
"It's not easy to make a couple of million dollars quickly," said Sherman.
He likens the current frontier blitz in the Bakken region to Moscow after the dismantling of the Soviet Union. where Sherman said he was one of the first western business consultants there between 1987 and 1997.
"I made a lot of money," he said.
Now he's positioning himself to help others make some money by being the boots on the ground for companies in places like Manitoba to connect with partners in the Bakken.
Mariette Mulaire, CEO of the Winnipeg WTC said, "We will work with the local companies who are convinced they have something to offer and connect them with the Montana WTC and they will find the right connections so we don't waste anybody's time."
Sherman said he knows of a handful of services much in demand that a clever operator could make a killing at.
For instance, he said the hundreds of trucks that are pounding the country roads in North Dakota and Montana have to wait for more than an hour to fuel up, burning fuel all the while and paying the drivers $40-to-$50 per hour.
He said there is a great opportunity for someone with a few tanker trucks and delivery trucks and about eight people to go around and refuel the trucks in the yard.
"You could make 50 cents-to-$1 per litre with such a service," he said.
The fracking drilling technology that has freed up the huge oil resource in the Bakken requires an intense 72-hours of straight pressurized drilling to get a well up and running.
That means the 50-odd workers on each site need to be fed while the drilling takes place.
Sherman said there are companies who run sandwich trucks to the well sites, but more are required.
"Not only that, but the companies with the largest catering contracts are always running out of bread, so there's bakeries required," he said. "It just goes on and on."
Republished from the Winnipeg Free Press print edition June 27, 2013 B4
Updated on Thursday, June 27, 2013 at 6:56 AM CDT: